Intrinsic value of Regeneron Pharmaceuticals, Inc. - REGN

Previous Close

$312.56

  Intrinsic Value

$575.39

stock screener

  Rating & Target

str. buy

+84%

Previous close

$312.56

 
Intrinsic value

$575.39

 
Up/down potential

+84%

 
Rating

str. buy

We calculate the intrinsic value of REGN stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 34.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  21.80
  20.12
  18.61
  17.25
  16.02
  14.92
  13.93
  13.04
  12.23
  11.51
  10.86
  10.27
  9.74
  9.27
  8.84
  8.46
  8.11
  7.80
  7.52
  7.27
  7.04
  6.84
  6.65
  6.49
  6.34
  6.21
  6.09
  5.98
  5.88
  5.79
Revenue, $m
  8,174
  9,819
  11,646
  13,654
  15,842
  18,206
  20,741
  23,445
  26,313
  29,341
  32,527
  35,868
  39,363
  43,012
  46,816
  50,776
  54,896
  59,179
  63,630
  68,255
  73,062
  78,058
  83,253
  88,655
  94,276
  100,126
  106,220
  112,568
  119,186
  126,089
Variable operating expenses, $m
  3,744
  4,497
  5,334
  6,254
  7,256
  8,338
  9,500
  10,738
  12,051
  13,438
  14,897
  16,428
  18,028
  19,700
  21,442
  23,256
  25,142
  27,104
  29,142
  31,261
  33,462
  35,751
  38,130
  40,604
  43,178
  45,858
  48,649
  51,556
  54,587
  57,749
Fixed operating expenses, $m
  1,155
  1,180
  1,206
  1,233
  1,260
  1,288
  1,316
  1,345
  1,374
  1,405
  1,436
  1,467
  1,499
  1,532
  1,566
  1,601
  1,636
  1,672
  1,709
  1,746
  1,785
  1,824
  1,864
  1,905
  1,947
  1,990
  2,034
  2,078
  2,124
  2,171
Total operating expenses, $m
  4,899
  5,677
  6,540
  7,487
  8,516
  9,626
  10,816
  12,083
  13,425
  14,843
  16,333
  17,895
  19,527
  21,232
  23,008
  24,857
  26,778
  28,776
  30,851
  33,007
  35,247
  37,575
  39,994
  42,509
  45,125
  47,848
  50,683
  53,634
  56,711
  59,920
Operating income, $m
  3,275
  4,141
  5,106
  6,168
  7,326
  8,580
  9,926
  11,362
  12,887
  14,498
  16,194
  17,973
  19,835
  21,780
  23,808
  25,920
  28,118
  30,403
  32,779
  35,248
  37,815
  40,484
  43,259
  46,146
  49,150
  52,279
  55,537
  58,934
  62,475
  66,169
EBITDA, $m
  3,457
  4,359
  5,364
  6,471
  7,678
  8,983
  10,386
  11,882
  13,470
  15,149
  16,915
  18,768
  20,708
  22,734
  24,846
  27,046
  29,335
  31,715
  34,189
  36,761
  39,435
  42,214
  45,105
  48,111
  51,240
  54,498
  57,892
  61,429
  65,117
  68,965
Interest expense (income), $m
  5
  38
  73
  113
  156
  205
  257
  314
  374
  439
  508
  580
  657
  737
  820
  908
  999
  1,094
  1,192
  1,295
  1,402
  1,512
  1,628
  1,747
  1,872
  2,001
  2,136
  2,276
  2,422
  2,574
  2,732
Earnings before tax, $m
  3,237
  4,068
  4,993
  6,011
  7,122
  8,323
  9,612
  10,988
  12,448
  13,990
  15,614
  17,317
  19,099
  20,960
  22,900
  24,921
  27,024
  29,211
  31,484
  33,846
  36,303
  38,856
  41,512
  44,274
  47,149
  50,143
  53,262
  56,512
  59,901
  63,437
Tax expense, $m
  874
  1,098
  1,348
  1,623
  1,923
  2,247
  2,595
  2,967
  3,361
  3,777
  4,216
  4,675
  5,157
  5,659
  6,183
  6,729
  7,296
  7,887
  8,501
  9,139
  9,802
  10,491
  11,208
  11,954
  12,730
  13,539
  14,381
  15,258
  16,173
  17,128
Net income, $m
  2,363
  2,970
  3,645
  4,388
  5,199
  6,076
  7,017
  8,021
  9,087
  10,213
  11,398
  12,641
  13,942
  15,301
  16,717
  18,192
  19,727
  21,324
  22,983
  24,708
  26,501
  28,365
  30,303
  32,320
  34,419
  36,604
  38,881
  41,254
  43,728
  46,309

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  12,634
  15,176
  17,999
  21,104
  24,485
  28,138
  32,058
  36,237
  40,669
  45,349
  50,273
  55,437
  60,840
  66,480
  72,359
  78,479
  84,847
  91,466
  98,346
  105,495
  112,924
  120,647
  128,675
  137,025
  145,712
  154,755
  164,173
  173,985
  184,214
  194,882
Adjusted assets (=assets-cash), $m
  12,634
  15,176
  17,999
  21,104
  24,485
  28,138
  32,058
  36,237
  40,669
  45,349
  50,273
  55,437
  60,840
  66,480
  72,359
  78,479
  84,847
  91,466
  98,346
  105,495
  112,924
  120,647
  128,675
  137,025
  145,712
  154,755
  164,173
  173,985
  184,214
  194,882
Revenue / Adjusted assets
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
  0.647
Average production assets, $m
  3,008
  3,613
  4,286
  5,025
  5,830
  6,700
  7,633
  8,628
  9,683
  10,797
  11,970
  13,199
  14,486
  15,829
  17,228
  18,686
  20,202
  21,778
  23,416
  25,118
  26,887
  28,725
  30,637
  32,625
  34,693
  36,847
  39,089
  41,425
  43,861
  46,401
Working capital, $m
  2,673
  3,211
  3,808
  4,465
  5,180
  5,953
  6,782
  7,667
  8,604
  9,595
  10,636
  11,729
  12,872
  14,065
  15,309
  16,604
  17,951
  19,351
  20,807
  22,319
  23,891
  25,525
  27,224
  28,990
  30,828
  32,741
  34,734
  36,810
  38,974
  41,231
Total debt, $m
  1,357
  2,087
  2,897
  3,788
  4,759
  5,807
  6,932
  8,131
  9,403
  10,747
  12,160
  13,642
  15,192
  16,811
  18,498
  20,255
  22,082
  23,982
  25,957
  28,008
  30,141
  32,357
  34,661
  37,057
  39,551
  42,146
  44,849
  47,665
  50,601
  53,663
Total liabilities, $m
  3,626
  4,355
  5,166
  6,057
  7,027
  8,076
  9,201
  10,400
  11,672
  13,015
  14,428
  15,911
  17,461
  19,080
  20,767
  22,524
  24,351
  26,251
  28,225
  30,277
  32,409
  34,626
  36,930
  39,326
  41,819
  44,415
  47,118
  49,934
  52,869
  55,931
Total equity, $m
  9,008
  10,820
  12,834
  15,047
  17,458
  20,063
  22,857
  25,837
  28,997
  32,334
  35,845
  39,527
  43,379
  47,400
  51,592
  55,956
  60,496
  65,215
  70,121
  75,218
  80,515
  86,021
  91,745
  97,698
  103,893
  110,340
  117,055
  124,051
  131,345
  138,951
Total liabilities and equity, $m
  12,634
  15,175
  18,000
  21,104
  24,485
  28,139
  32,058
  36,237
  40,669
  45,349
  50,273
  55,438
  60,840
  66,480
  72,359
  78,480
  84,847
  91,466
  98,346
  105,495
  112,924
  120,647
  128,675
  137,024
  145,712
  154,755
  164,173
  173,985
  184,214
  194,882
Debt-to-equity ratio
  0.150
  0.190
  0.230
  0.250
  0.270
  0.290
  0.300
  0.310
  0.320
  0.330
  0.340
  0.350
  0.350
  0.350
  0.360
  0.360
  0.370
  0.370
  0.370
  0.370
  0.370
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.390
  0.390
Adjusted equity ratio
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,363
  2,970
  3,645
  4,388
  5,199
  6,076
  7,017
  8,021
  9,087
  10,213
  11,398
  12,641
  13,942
  15,301
  16,717
  18,192
  19,727
  21,324
  22,983
  24,708
  26,501
  28,365
  30,303
  32,320
  34,419
  36,604
  38,881
  41,254
  43,728
  46,309
Depreciation, amort., depletion, $m
  181
  218
  258
  303
  351
  404
  460
  520
  583
  650
  721
  795
  873
  954
  1,038
  1,126
  1,217
  1,312
  1,411
  1,513
  1,620
  1,730
  1,846
  1,965
  2,090
  2,220
  2,355
  2,495
  2,642
  2,795
Funds from operations, $m
  2,544
  3,187
  3,903
  4,691
  5,550
  6,479
  7,477
  8,541
  9,670
  10,863
  12,119
  13,436
  14,815
  16,254
  17,755
  19,318
  20,944
  22,636
  24,394
  26,221
  28,121
  30,095
  32,149
  34,286
  36,509
  38,824
  41,236
  43,749
  46,370
  49,104
Change in working capital, $m
  478
  538
  597
  657
  715
  773
  829
  884
  938
  990
  1,042
  1,093
  1,143
  1,193
  1,244
  1,295
  1,347
  1,400
  1,456
  1,513
  1,572
  1,634
  1,699
  1,767
  1,838
  1,913
  1,992
  2,076
  2,164
  2,257
Cash from operations, $m
  2,066
  2,650
  3,306
  4,034
  4,835
  5,706
  6,648
  7,657
  8,733
  9,873
  11,077
  12,344
  13,672
  15,061
  16,511
  18,023
  19,597
  21,235
  22,938
  24,709
  26,549
  28,462
  30,451
  32,519
  34,671
  36,911
  39,243
  41,673
  44,206
  46,847
Maintenance CAPEX, $m
  -149
  -181
  -218
  -258
  -303
  -351
  -404
  -460
  -520
  -583
  -650
  -721
  -795
  -873
  -954
  -1,038
  -1,126
  -1,217
  -1,312
  -1,411
  -1,513
  -1,620
  -1,730
  -1,846
  -1,965
  -2,090
  -2,220
  -2,355
  -2,495
  -2,642
New CAPEX, $m
  -541
  -605
  -672
  -739
  -805
  -870
  -933
  -995
  -1,055
  -1,114
  -1,172
  -1,230
  -1,286
  -1,343
  -1,400
  -1,457
  -1,516
  -1,576
  -1,638
  -1,702
  -1,769
  -1,839
  -1,912
  -1,988
  -2,068
  -2,153
  -2,242
  -2,336
  -2,435
  -2,540
Cash from investing activities, $m
  -690
  -786
  -890
  -997
  -1,108
  -1,221
  -1,337
  -1,455
  -1,575
  -1,697
  -1,822
  -1,951
  -2,081
  -2,216
  -2,354
  -2,495
  -2,642
  -2,793
  -2,950
  -3,113
  -3,282
  -3,459
  -3,642
  -3,834
  -4,033
  -4,243
  -4,462
  -4,691
  -4,930
  -5,182
Free cash flow, $m
  1,376
  1,863
  2,416
  3,037
  3,727
  4,485
  5,311
  6,202
  7,157
  8,175
  9,254
  10,393
  11,590
  12,845
  14,158
  15,528
  16,956
  18,442
  19,988
  21,596
  23,267
  25,003
  26,809
  28,685
  30,637
  32,668
  34,781
  36,982
  39,275
  41,665
Issuance/(repayment) of debt, $m
  649
  730
  810
  891
  970
  1,048
  1,125
  1,199
  1,272
  1,343
  1,413
  1,482
  1,550
  1,619
  1,687
  1,757
  1,827
  1,900
  1,974
  2,052
  2,132
  2,216
  2,304
  2,396
  2,493
  2,595
  2,703
  2,816
  2,936
  3,062
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  649
  730
  810
  891
  970
  1,048
  1,125
  1,199
  1,272
  1,343
  1,413
  1,482
  1,550
  1,619
  1,687
  1,757
  1,827
  1,900
  1,974
  2,052
  2,132
  2,216
  2,304
  2,396
  2,493
  2,595
  2,703
  2,816
  2,936
  3,062
Total cash flow (excl. dividends), $m
  2,025
  2,593
  3,226
  3,928
  4,697
  5,534
  6,436
  7,401
  8,430
  9,519
  10,668
  11,875
  13,141
  14,464
  15,845
  17,285
  18,783
  20,342
  21,963
  23,648
  25,399
  27,220
  29,113
  31,082
  33,131
  35,263
  37,484
  39,798
  42,211
  44,727
Retained Cash Flow (-), $m
  -1,618
  -1,812
  -2,013
  -2,213
  -2,411
  -2,605
  -2,794
  -2,980
  -3,160
  -3,337
  -3,511
  -3,682
  -3,852
  -4,021
  -4,192
  -4,364
  -4,540
  -4,720
  -4,905
  -5,097
  -5,297
  -5,506
  -5,724
  -5,953
  -6,194
  -6,448
  -6,715
  -6,996
  -7,293
  -7,607
Prev. year cash balance distribution, $m
  1,367
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  1,775
  780
  1,213
  1,714
  2,287
  2,929
  3,641
  4,422
  5,269
  6,182
  7,157
  8,193
  9,289
  10,443
  11,654
  12,920
  14,243
  15,622
  17,057
  18,550
  20,102
  21,714
  23,389
  25,128
  26,936
  28,816
  30,769
  32,802
  34,917
  37,120
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  1,701
  714
  1,055
  1,412
  1,772
  2,126
  2,460
  2,764
  3,027
  3,241
  3,399
  3,496
  3,532
  3,506
  3,421
  3,283
  3,099
  2,877
  2,626
  2,357
  2,079
  1,802
  1,533
  1,280
  1,048
  841
  660
  507
  381
  280
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Regeneron Pharmaceuticals, Inc. is a biopharmaceutical company that discovers, invents, develops, manufactures and commercializes medicines for the treatment of serious medical conditions. The Company commercializes medicines for eye diseases, high low-density lipoprotein (LDL) cholesterol, and an inflammatory condition and have product candidates in development in other areas, including rheumatoid arthritis, asthma, atopic dermatitis, pain, cancer, and infectious diseases. The Company's marketed products include EYLEA (aflibercept) Injection, Praluent (alirocumab) Injection, ARCALYST (rilonacept) Injection for Subcutaneous Use, Kevzara (sarilumab) Solution for Subcutaneous Injection and ZALTRAP (ziv-aflibercept) Injection for Intravenous Infusion. As of December 31, 2016, the Company had 16 product candidates in clinical development, which consisted of a Trap-based clinical program and 15 fully human monoclonal antibody product candidates.

FINANCIAL RATIOS  of  Regeneron Pharmaceuticals, Inc. (REGN)

Valuation Ratios
P/E Ratio 37
Price to Sales 6.8
Price to Book 7.4
Price to Tangible Book
Price to Cash Flow 22.5
Price to Free Cash Flow 34.5
Growth Rates
Sales Growth Rate 18.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -24.5%
Cap. Spend. - 3 Yr. Gr. Rate 26.8%
Financial Strength
Quick Ratio 8
Current Ratio 0.1
LT Debt to Equity 7.9%
Total Debt to Equity 10.8%
Interest Coverage 267
Management Effectiveness
Return On Assets 14.3%
Ret/ On Assets - 3 Yr. Avg. 12.7%
Return On Total Capital 20%
Ret/ On T. Cap. - 3 Yr. Avg. 16.8%
Return On Equity 22.1%
Return On Equity - 3 Yr. Avg. 19.2%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 93.8%
Gross Margin - 3 Yr. Avg. 92.3%
EBITDA Margin 29.6%
EBITDA Margin - 3 Yr. Avg. 30.4%
Operating Margin 27.4%
Oper. Margin - 3 Yr. Avg. 28.5%
Pre-Tax Margin 27.4%
Pre-Tax Margin - 3 Yr. Avg. 28.1%
Net Profit Margin 18.4%
Net Profit Margin - 3 Yr. Avg. 15.3%
Effective Tax Rate 32.6%
Eff/ Tax Rate - 3 Yr. Avg. 45.4%
Payout Ratio 0%

REGN stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the REGN stock intrinsic value calculation we used $6711 million for the last fiscal year's total revenue generated by Regeneron Pharmaceuticals, Inc.. The default revenue input number comes from 0001 income statement of Regeneron Pharmaceuticals, Inc.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our REGN stock valuation model: a) initial revenue growth rate of 21.8% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for REGN is calculated based on our internal credit rating of Regeneron Pharmaceuticals, Inc., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Regeneron Pharmaceuticals, Inc..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of REGN stock the variable cost ratio is equal to 45.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $1130 million in the base year in the intrinsic value calculation for REGN stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Regeneron Pharmaceuticals, Inc..

Corporate tax rate of 27% is the nominal tax rate for Regeneron Pharmaceuticals, Inc.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the REGN stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for REGN are equal to 36.8%.

Life of production assets of 16.6 years is the average useful life of capital assets used in Regeneron Pharmaceuticals, Inc. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for REGN is equal to 32.7%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $8757.3 million for Regeneron Pharmaceuticals, Inc. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 109.272 million for Regeneron Pharmaceuticals, Inc. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Regeneron Pharmaceuticals, Inc. at the current share price and the inputted number of shares is $34.2 billion.

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